Experienced Strategists Dedicated to Achieving Clients’ Goals

Ex-Employees File Suit Against IBM Over Age Discrimination

On Behalf of | Apr 3, 2019 | Workplace Discrimination |

Ever since the nonprofit newsroom ProPublica did an exposé last year, former IBM employees have wondered whether the company’s recent global restructuring and layoffs were motivated in part by age discrimination. Now, a group of ex-workers has filed a federal lawsuit in an effort to break down two barriers IBM put in the way of age discrimination claims.

As we discussed last year, ProPublica learned that IBM had cut 20,000 U.S. workers over the age of 40 in the previous five years. The Age Discrimination in Employment Act (ADEA) prohibits discrimination against people 40 and over.

That meant that people over 40 accounted for 60 percent of IBM’s U.S. job cuts. Some of the former employees were told their skills were out of date but were nevertheless hired back as contractors to do the same work for substantially less pay and benefits. Others were replaced by younger workers.

Moreover, an internal company memo said one reason for the restructuring was to “correct seniority mix.” Overall, it seemed that IBM was intentionally getting rid of older workers who had earned higher salaries over time.

Age discrimination can be hard to detect

IBM also made it difficult for workers to determine whether age discrimination had motivated their terminations. This is because the company withheld information — required by the ADEA — about the ages and job positions of any workers being laid off who were over 40. This information could have provided strong evidence of discrimination, although much of it has now been discovered by ProPublica.

During the layoffs, which also included forced retirements, IBM required departing workers to sign severance agreements that require individual arbitration of any discrimination claims.

Now, a group of laid-off workers claims in their federal lawsuit that the withheld information and the severance agreement are illegal. The ADEA authorizes workers who suspect age discrimination to file lawsuits or choose arbitration. Moreover, the plaintiffs indicate they were essentially coerced into signing the severance agreement.

The lawsuit seeks to invalidate the forced arbitration clause in the severance agreement. They also seek to hold IBM accountable for refusing to provide age information about those it laid off.

This isn’t the first action brought against IBM after the ProPublica exposé. Last fall, lawyers representing 60 ex-employees who had refused to sign the severance agreement filed a class action lawsuit alleging age discrimination. At the same time, lawyers filed scores of arbitration cases on behalf of those who had signed the document.

Have you observed similar behavior at your own company? If so, have you considered filing an age discrimination complaint? Before you do, it’s a good idea to discuss your situation with an experienced employment law attorney.